Industry minister Toshimitsu Motegi on Tuesday approved electricity rate hikes for households requested by three utilities facing growing fuel costs amid the halt of their nuclear reactors.
Hokkaido Electric Power Co. will raise rates by 7.73 percent on average from Sept. 1, Tohoku Electric Power Co. plans a 8.94 percent hike and Shikoku Electric Power Co. a 7.80 percent rise.
It will be their first drastic rate hikes in more than 30 years.
The rate hikes will impose a new burden on household finances at a time when expenses for daily necessities such as food are increasing due to the yen’s depreciation, which pushes up import prices.
The three utilities sought the hikes as their businesses have deteriorated due to rising fuel costs from running thermal power plants to compensate for the loss of nuclear energy.
The approved hikes are lower than those initially sought by the utilities, with the government finding room for them to reduce the costs they hoped to pass onto consumers.
“As a utility with the disaster-affected area under our jurisdiction, we will do our utmost to make our business efficient,” Makoto Kaiwa, president of Tohoku Electric, told Natural Resources and Energy Agency Director General Takayuki Ueda.
Tohoku Electric later said its president and chairman will return 70 percent of their pay starting this month.
Hokkaido Electric will raise the rates it charges businesses by 11 percent, Tohoku Electric by 15.24 percent and Shikoku Electric by 14.72 percent.